NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

The Effect of Hospital/Physician Integration on Hospital Choice

Laurence C. Baker, M. Kate Bundorf, Daniel P. Kessler

NBER Working Paper No. 21497
Issued in August 2015
NBER Program(s):Health Care

In this paper, we estimate how hospital ownership of physicians’ practices affects their patients’ hospital choices. We match data on the hospital admissions of Medicare beneficiaries, including the identity of their admitting physician, with data on the identity of the owner of the admitting physician’s practice. We find that a hospital's ownership of an admitting physician’s practice dramatically increases the probability that the physician's patients will choose the owning hospital. We also find that patients are more likely to choose a high-cost, low-quality hospital when their admitting physician’s practice is owned by that hospital.

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Document Object Identifier (DOI): 10.3386/w21497

Published: Laurence C. Baker & M. Kate Bundorf & Daniel P. Kessler, 2016. "The Effect of Hospital/Physician Integration on Hospital Choice," Journal of Health Economics, .

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